New York, Jan 21, 2026, 15:05 ET — Regular Session
- Schwab shares climbed roughly 1.5% following a fourth-quarter profit boost driven by higher interest income and increased trading activity
- Net interest revenue surged over 25%, while quarterly core net new assets reached a record high
- Schwab CEO Rick Wurster confirmed the company is still aiming to roll out spot Bitcoin and Ethereum trading during the first half of 2026
Shares of The Charles Schwab Corporation (SCHW) climbed Wednesday following a strong quarterly profit report, lifting trading-related stocks broadly. Schwab was up roughly 1.5% to $102.55 in afternoon action, after swinging between $97.10 and $104.78. Interactive Brokers jumped around 7.1%, and Robinhood added 1.2%. Both the SPDR S&P 500 ETF (SPY) and the Financial Select Sector SPDR Fund (XLF) also moved higher.
This print is crucial since Schwab straddles two key metrics investors watch closely: client cash and client clicks. More trades mean higher fees, while bigger cash balances boost the firm’s income from interest spreads.
Rates drive everything here. Schwab’s earnings hinge on where clients park their cash and the returns they pull, which get shakier as the market guesses the Fed’s next step.
Schwab reported a 19% rise in fourth-quarter net revenue to $6.34 billion, slightly missing analysts’ $6.37 billion target, according to LSEG data. Net income jumped to $2.46 billion, or $1.33 per share, up from $1.84 billion, or 94 cents, the previous year. Net interest revenue — the difference between earnings on assets and costs on liabilities — surged over 25% to $3.17 billion as clients adjusted portfolios amid uncertainty about the Fed’s rate moves and geopolitical tensions. Core net new assets, which measure client inflows minus withdrawals, set a new record at $163.9 billion. (Reuters)
Total client assets hit a record $11.90 trillion, up 18%, while client accounts climbed to 46.5 million. CEO Rick Wurster said Schwab had “delivered growth on all fronts.” Daily average trading volume surged 31% to 8.3 million, pushing trading revenue up 22%. Asset management and administration fees increased 15% to $1.7 billion, the company reported. Net interest margin expanded 57 basis points to 2.90%, and sweep cash balances closed December at $453.7 billion as bank supplemental funding dropped to $5.1 billion. Schwab repurchased 29.2 million shares for $2.7 billion. CFO Mike Verdeschi confirmed “capital ratios remained strong.” (Charles Schwab Press Room)
During the earnings call, Wurster told analysts Schwab is still “on track to launch spot trading on Bitcoin and Ethereum in the first half of this year,” aiming to expand its reach among active-trader clients and new product offerings. He also made it clear the firm has no plans to enter sports-related prediction markets. (Investing)
Net interest revenue reflects the spread Schwab earns on customer cash and securities it holds, usually climbing when rates rise or more cash remains in sweep accounts. Trading revenue depends on customer activity and can drop quickly if markets calm down.
That balance works both ways. Economists surveyed by Reuters this week forecast the Fed will hold its policy rate between 3.50% and 3.75% through March. Yet, if rates fall faster or clients flock again to higher-yield options, Schwab’s interest income could come under pressure. (Reuters)
The next major event is the Fed meeting on Jan. 27-28, with the rate decision and press conference set for Jan. 28. Traders are focused on the rate trajectory and Schwab’s first-quarter cash flow trends, searching for early signs of whether the recent earnings boost will hold. (Federalreserve)
